Originally posted by Desert_Rat:
The only way this can happen is a bad head gasket.
That's the most common way but there could be a bad intake gasket, cracked head, or even cracked block. Heads could also be warped enough to act like a blown head gasket. The engine overheated pretty badly if I remember correctly. Probably a few other possibilites too that I'm not thinking of right now.
Do a pressure test on the coolant system to see if it leaks down and if you can see where it's leaking from if it does. If the pressure leaks down and you don't see the leak...then you can start to worry.